According to Classical Economists,government Intervention Is

question 95

Multiple Choice

According to classical economists,government intervention is:

• A)necessary to maintain a stable price level in the long run.
• B)necessary to maintain a stable price level in the short run.
• C)necessary to maintain full employment in the long run.
• D)necessary to maintain full employment in the short run.
• E)not necessary to maintain full employment.

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Definitions:

Marginal Revenue

The extra revenue obtained by selling an additional unit of a product or service.

Upsloping Line

A graphical representation indicating positive correlation between two variables; as one variable increases, so does the other.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded by consumers, usually downward sloping.

Pure Competition

A market structure characterized by a large number of small firms, a homogeneous product, and easy entry and exit from the market.